How Do Estate Agents Determine The Value Of A Property For A Sale Or Purchase?

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Are you thinking of selling your home or purchasing a new one? You might have wondered what the worth of your home is and how your real estate agent is going to determine its value. As a homeowner, you might tend to overestimate the real worth of your home, as every person wants to think that their property is a little bit better than its actual value. For instance, you can browse and discover property prices on Tenerife Estate Agents site to get an idea about the current real estate market in the area. The value of a home is subjective as one buyer might be willing to pay more than the rest. So if you are selling your house or looking to purchase one, it’s important to know the true value of a house. This can be determined by a real estate agent to find a sweet spot that will help to reach your goals and also attract more buyers (in the case you are selling.)

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There are many online websites and resources that can give you estimated property values. However, they might not be accurate. This is why it is best to get in touch with a trustworthy real estate agent to receive the best price for your property or get your hands on the best property according to the current market value. Let us deep dive into the ways estate agents determine the real value of a property for sale or purchase.

How Will a Real Estate Agent Calculate Home Value?

Specifying the “asking price” of a property can be challenging when you list it for sale. You can have a trustworthy estate agent (that knows the market factors) determine the number that will be listed on the interwebs. He will have access to various sources to establish accurate market value. The realtor can:

Review the current value according to the state you live in.
Review current listings and recent sale history for similar properties.
Do on-site property inspections to examine the interior and exterior of your property in detail and note down everything that can affect its value.
Give you transparent information about the current economy and the effect it might have on the value of your property.

Based on the above information, the realtor comes up with a comparative market analysis.

Comparative Market Analysis (CMA)

There are various factors that can impact the value of a home. CMA can look into 4 to 5 comparable recently sold properties in your neighborhood (preferably within a 1-mile radius) for getting a fair opinion of the current value. It can also look at aspects like the dining area, living room, number of bathrooms and bedrooms, the home’s square footage, floors, comparable conditions, lot size, and home style. The realtor will even take certain elements into consideration, like access to amenities, issues in the neighborhood like noise complaints or crime rate, and accessibility to school districts and medical facilities. For example, if a recently sold home was in a comparable state but had a jacuzzi, the agent will deduct the value of it without decreasing the worth of your home just because it does not have the same amenities. They also have access to Multiple Listing Services (MLS) which means they have information about all the recently sold properties in your neighborhood.

Past Appraisals

This is another tool used by real estate agents for calculating a home’s value. However, if the market is currently witnessing large changes in appraisals, it can lag increasing home values, which can result in appraisal discrepancies or pose to be excessively high for the current market. A homeowner knows their home the best its owner and hence a real estate agent will get inputs from homeowners for comparative data. For instance, the impacted comparative prices might also show that someone had to sell their home at a lower price due to a divorce or death. Hence your real estate agent can use these tools for a fair estimate.

More Factors That Can Impact Home Value Calculations

Accessibility to school districts that maintain high academic benchmarks and offer a wide spectrum of extracurriculars.
The value of a location when it comes to its proximity to various services and amenities like walking trails, parks, recreation, and entertainment.
If the neighborhood has development prospects, it might lead to higher home values in the future.

A trustworthy real estate agent has access to reliable and complete information that can be useful for attracting potential buyers if you are selling a home or finding your dream home. Your realtor can establish the current value of your home so you receive the price that works best for you. Having a trustworthy real estate agent can go a long way to understanding the various market factors that determine the true value of a property like past appraisals, comparative market analysis, current economy, demand and supply, and existing inventories. So get in touch with a dedicated real estate agent to find your dream home or sell your home at the best price.